State can charge retired public workers more for coverage, ruling says

Updated 7:21 am, Thursday, December 27, 2012

ALBANY — A state Supreme Court justice has dismissed a challenge to a state decision to impose the same health care cost increases on retired workers negotiated by public employees unions.

In a forceful decision, state Supreme Court Justice George B. Ceresia of Troy concluded that even giving the retirees a liberal interpretation of their arguments, "petitioners have failed to state any valid cause of action."

As with active employees, the share for retirees went up from 10 percent to 12 percent of the total premium cost for an individual plan, and from 25 percent to 27 percent for a family plan. Plaintiffs noted typical costs could go from $59 to $95 per month for an individual, or from $250 to $331 per month for a family plan — especially tough, they argued, for retirees on a fixed income.

In his 18-page order, dated Dec. 17, Ceresia rejected the three grounds for action in the challenge to the increase.

In dismissing the plaintiffs' claim that the increase violates Civil Service Law, Ceresia said the suit failed to note the amendment of the law that allows the state to increase the retirees' share. The ruling also rejected what the judge referred to as their "belated alternate argument" that the court should protect employees who retired before Oct. 1, 2012 from being hit with the increase. The action would, Ceresia wrote, be a clear violation of the separation of powers.

In response to the argument that the increase violated the contracts clause of the U.S. Constitution and its state equivalent, Ceresia concluded "there is no 'contract' that entitles petitioners to continued state contributions to public retirees health care at the same levels as they received prior to enactment" of the 2011 amendment to Civil Service Law.

The judge also disagrees with the argument that health care benefits and pension benefits enjoy the same level of protection. Because they are singled out for mention in the state constitution, pension payments have been seen as being virtually inviolate — even in cases where public employees or elected officials have committed crimes connected to their duties.

To the plaintiff's third cause of action, that the state Civil Service Commission's involvement in the increase violates the separation of powers in the state constitution, Ceresia noted the Legislature's bill language explicitly allowed for the adjustment to be made by the commission's president, with the approval of the state budget director.

"The petitioners have failed to present specific allegations that would support their conclusion that the Legislature ceded any fundamental policy responsibility to make social and political policy to the president of the Civil Service Commission," Ceresia wrote.

Tony Cantore, who handles legislative affairs for the RPEA, said the organization hasn't made a decision on whether to appeal the dismissal. The topic will likely be addressed at its next board meeting set for January, he said.